The lenders say they are being cheated out of hundreds of millions of dollars in the takeover of the 11,000-unit apartment complex.

CWCapital Asset Management was sued by lenders claiming they are being cheated out of hundreds of millions of dollars in the takeover of the Stuyvesant Town-Peter Cooper Village, Manhattan's largest apartment complex.

CWCapital, which has managed the 11,000-unit development on bondholders' behalf since 2010, took title to the property June 3 by exercising a deed in lieu of foreclosure. CWCapital canceled an auction and indicated it will put the complex up for sale.

CWCapital engaged in "a continuing pattern of misconduct designed" to keep control of the property and "reap an unjust windfall" of $1 billion that should go to lower-level lenders who have received nothing, according to the complaint filed Thursday in New York State Supreme Court in Manhattan.

The lenders, using names such as PCVST Mezzco 4, asked a judge to award unspecified compensatory and punitive damages. The suit also names commercial-mortgage trusts set up by Wachovia Bank, which San Francisco-based Wells Fargo & Co. acquired in 2008. Wells Fargo isn't a party to the suit.

Tishman Speyer Properties and BlackRock Inc. purchased the complex for $5.4 billion in 2006, taking out a $3 billion mortgage and $1.4 billion of mezzanine debt. They defaulted on the senior mortgage in 2010, after the financial crisis and the thwarting of their plans to raise rents.

Fortress bid

Private-equity firm Fortress Investment Group, which owns Bethesda, Md.-based CW, had been seeking financing for a potential $4.7 billion bid on the complex, a person familiar with the matter said in May.

A spokesman for CWCapital didn't immediately respond to a phone call requesting comment on the suit.

The lenders alleged in the complaint that the takeover was "executed on the flawed premise that the amount owed on the senior loan was greater than the value of the property." CWCapital represented that $4.4 billion was owed on the mortgage when the amount was really $3.45 billion, the lenders said.

"Far from being underwater, had Stuy Town been sold at market value, it would have fetched a price high enough that more than one billion dollars would have been left over the correct mortgage amount to repay the junior lenders whose loans remain wholly unpaid," according to the complaint.

Stuyvesant Town-Peter Cooper Village, located between 14th and 23rd Streets along the East River, is home to more than 30,000 residents. MetLife Inc. built the property in the 1940s with city assistance to house returning World War II veterans.

Annual income at the 80-acre community has climbed by $54 million since Tishman Speyer and BlackRock walked away from their investment, according to Amherst Securities Group.